After two years of foreclosure actions, Torchlight Investors has finally taken control of a Fifth Avenue retail property from Harbor Group International.
Torchlight, led by Daniel Heflin and Marc Young, acquired the retail portion of 445 Fifth Avenue for $40 million from Harbor Group, records show. The price matched the amount of the loan owed on the property.
The transaction marks a rare miss for Harbor Group, which is known for large multifamily deals. The firm, led by Jordan Slone and boasting $20 billion in assets, bought the retail portion of the 33-story Fifth Avenue condo tower from Thor Equities for $68 million in 2015. It secured a $40 million loan from CIBC to acquire the property.
But once Covid struck, the loan fell into distress. CIBC sued Harbor Group, alleging it missed monthly payments and failed to keep the minimum reserve balance.
Park Avenue-based Torchlight, which specializes in distress, bought the $40 million loan and sought to foreclose. Torchlight claimed it was owed more money from Harbor Group, including over $1.4 million for making “protective advances” to the property’s temporary receiver.
Harbor Group’s attempt to dismiss the lawsuit was denied by a judge. The lawsuit was recently discontinued.
In 2020, the Australian firm Brickworks Design Studio signed a 10-year lease to occupy most of the property and remains in the space, according to its website. The retail unit, between 39th and 40th streets, was previously leased to jewelry store Charming Charlie, which filed for bankruptcy in 2017 and again in 2019.
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In an unrelated action in 2021, Torchlight attempted to foreclose on a hotel in Miami’s Brickell area, which prompted the owners to put the property into bankruptcy protection. In 2022, the owner and Torchlight resolved the dispute.
Torchlight’s website says the firm was founded in 1995 and has $5.9 billion in assets under management.